1. Quality Systems Research for
New and Existing Homes
NAHB Research Center
Residential Building Energy Efficiency Meeting
July 2010

2. Building America
Quality Process
Goal:
Make widely available to
builders/remodelers processes, tools, and
methods to build and retrofit high
performance homes on a repeatable scale
 Economics of Quality
 HPH Scopes of Work
 Hotspot Inspection Process
 HPH Quality Management System
p. 2

3. Economics of Quality
 Goals:
 Quantify benefits of
implementing quality
practices
 Validate performance
improvements achieved
through quality practices
p. 3

4. Hypothetical Cost of Quality
(Cokins, 2006)
 PC=prevention cost  IFC=internal failure cost
 AC=appraisal cost  EFC=external failure cost p. 4

5. Malcolm Baldrige National Quality (MBNQ)
Award Winners Over 8 Year Study
(Wrolstad & Krueger, 2001)
Matched, Non-Winning
MBNQA Winners
Companies,
1988-1996
1988-1996
Return on equity +18.73% -5.91%
Return on assets +10.28% -5.5%
Operating profit margin +46.77% +2.69%
Operating margin +1.12 -1.71
+16.2%
Return on investment +18.1%
(S&P500 Index, +13%)
p. 5

6. Opportunities for Builders
(Professional Builder Magazine, May 2009)
Do Builders See a Need for
Improvement?
 Operational Efficiencies
 60%
 Better Product
Marketing & Services
 29%
p. 6

7. National Housing Quality Award
(NHQA) Results 1993-2009
NHQA Winning Builder
Category
Benefit from Quality
Profits (Gross Margins) 12-20%
Revenue 15-100% increase/yr
Construction Costs vs. Budget +/- 1%
Customer Satisfaction 93-97%
Referral Rates
29%
(Sales made through referral)
Cycle Time Reductions 15-50%
Zero Defects at Closing 98%
Defect Reductions 11-75%
Employee Satisfaction 94%
Trade Satisfaction 95%
Customer Endorsements/ Thank You Letters 73%
Warranty Requests 1 per every 15.5 homes
p. 7

8. How to Measure Quality?
Performance Metrics
 Construction schedules
 On-time delivery
 Energy performance
 Cost
 Training
 Satisfaction
 Referral
 Productivity
 Warranty/Defects
p. 8

9. Challenges of Performance
Metrics
 Comparing
“apples to apples”
 Defining them so
all builders can
use them as
benchmarks
p. 9

10. Quality Impacts at
Veridian Homes
 Construction Costs
 -/+1% Budget vs. Actual
 Customer Satisfaction
 95% +
 Veridian Homebuyers
 76% only looked at Veridian
 Zero Defects
 90% of homes at home
orientation
 HERS Index
 58-61
p. 10

11. Veridian Results
 Reduced Defects
 50% in 1 yr
 Cut inspections in half
 Reduced Warranty Costs & Defects
 30% - 75%
 Reduced Construction Cycle Time
 18 days
 Reduced Material Variance
 20% lumber, 24% siding, & 38% trim
 Their Secret?
 Commitment to quality management
 Use of tools, principles and resources, including
a HPH quality management system
p. 11

12. Economics of Quality
Existing Homes
 Define remodeling industry
quality management needs
 Create industry-specific
quality tools & techniques
 Identify industry role model
remodelers with QMS to
create case studies
p. 12

13. Economics of Quality for
Existing Homes Next Steps
 Determine type of
remodeling contractor(s)
 Research quality
management impact data for
remodeling
 Prioritize performance issues
in the remodeling industry
 Define remodeling
performance metrics
p. 13

14. High Performance Homes (HPH)
Scopes of Work (SOW)
Completed New Home Construction
 HVAC
 Framing
 Foundations
 Vented & Unvented
Crawlspaces
 Excavation
 Grading
 Vinyl Siding
 WRB
 Rigid Insulating Sheathing
p. 14

15. Planned New HPH SOW
 Envelope sealing
 Ventilation
 Insulation
(wall, ceiling, and floor)
 PV roof installation
 Window Installation
 Door installation
p. 15

16. HPH Remodeling SOW Considerations
New Home Elements Proposed Remodel
2) Design and Specification 2) Re-design, Specifications,
Prerequisites & Statement of job limits
3) Details 3) Details
4) Jobsite conditions 4) Jobsite conditions
5) Order of work 5) Order of work
6) SOW Contract language 6) SOW Contract language
7) SOW QA Inspection 7) SOW QA Inspection/
checklists (Job ready, Assessment checklists
phase, and final)
p. 16

17. HPH Remodeling SOW Considerations
 Customizing SOW for Remodeling (every time?)
 Other considerations for remodeling
 Health and safety
 Demolition, crew type, materials, etc
 Quality performance criteria for remodeling
 Remodeling SOW Quality Assurance (QA) Process
 Need to define types of QA
 QA timing
 QA criteria
 QA documentation
p. 17

18. High Performance Home
Hotspot Process
A Hotspot is a Problem that is:
 Current
 Widespread or recurring
 A significantly important challenge
p. 18

19. Why Do Hotspots Work?
Hotspots work because they are:
 Focused on a prioritized topic
 Well-trained to all workers
 Inspected and tracked for all jobs
Which educates workers and
creates accountability
p. 19

20. Hotspot Process
p. 20

21. Hotspot Examples
Jobsite Installation or Personnel Or Company
Office Operations
Supply Culture
High air infiltration Too many backordered items Culture of finger-pointing
Poor performing Difficulty locating records or
Lack of accountability
ducts documents
Squeaky floors
Errors on take-offs High employee turnover
Late or incomplete Not responding in a timely
Lack of pride
deliveries manner to customer requests
p. 21

22. Choose Hotspot Using Data
HOTSPOT/INSPECTION LOG
Builder/Lot Inspection Items from Job Complete Forms
Hotspot Item Item 1 Item 2 Item 3 Item 4 Item 5 Item 6 Item 7 Item 8
Smith Building 2
Elders 23 1 1
Elders 24 1
Elders 25 1 1
Elders 26
The Meadows 12
The Meadows 13
The Meadows 14 1
The Meadows 15
The Meadows 16 1
The Meadows 17
1
R&R Custom Homes
1002 Peaceful Way 1 1
1004 Peaceful Way 1
1006 Peaceful Way 1 1
1008 Peaceful Way 1
Total 3 1 5 1 0 1 0 1 1
p. 22

23. Determine The Root Cause
p. 23

24. Develop Hotspot Training Sheet
Install mechanical dampers on supply-air duct lines off the plenum
Instale válvulas mecánicas en las líneas de conducción de aire del pleno
p. 24

25. Sign Hotspot Training Log
All crew members and all crew leaders must attend session.
•Lead man explains the problem and the proposed solution.
•Everyone examines both pictures and all notes.
•Lead man answers any questions.
•All crew members and crew leaders sign below.
•Lead man signs and dates bottom of page.
TIME MEETING STARTED: __________________a.m./p.m.______
ATTENDEES:
_____(PRINT NAME)________ _________(SIGNATURE)______________
___________________________ ____________________________________
___________________________ ____________________________________
___________________________ ____________________________________
___________________________ ____________________________________
p. 25

26. Conduct Hotspot Training
p. 26

27. Inspect Hotspot On All Jobs
Subdivision:
Lot:
Date of initial inspection:
Builder:
Builder Supervisor Name: Crew Leader Name:
Instructions: Check box if OK, circle box if correction is needed. Note specific correction action required.
When corrected, then check box.
Trade Trade Explain Needed Corrections
Builder
Foreman Super List Date Corrected
OK OK OK/NA
Lap and tape
Describe Current Hotspot:
  
all horizontal house wrap seams
The house wrap is installed continuously with no
1. tears or rips, or all rips or tears are properly   
repaired. [BCQC-23]
2. The house wrap is lapped as specified. [BCQC-23]   
The house wrap is fastened with manufacturer’s
3.
specified fasteners.
  
The house wrap joints are taped with
4.
manufacturer’s specified product. [BCQC-16]
  
The house wrap covers the sill plate, rim joist, and
5.
top plates.
  
p. 27

28. Evaluate Inspection Data
HOTSPOT/INSPECTION LOG
Builder/Lot Inspection Items from Job Complete Forms
Hotspot Item Item 1 Item 2 Item 3 Item 4 Item 5 Item 6 Item 7 Item 8
Smith Building 2
Elders 23 1 1
Elders 24 1
Elders 25 1 1
Elders 26
The Meadows 12
The Meadows 13
The Meadows 14 1
The Meadows 15
The Meadows 16 1
The Meadows 17
1
R&R Custom Homes
1002 Peaceful Way 1 1
1004 Peaceful Way 1
1006 Peaceful Way 1 1
1008 Peaceful Way 1
Total 3 1 5 1 0 1 0 1 1
p. 28

29. Repeat the Process, If Needed
 If hotspot is not
successful
 Return to the root cause
analysis stage
 Reevaluate other
possible causes
 Repeat the process with
the next most probably
cause
Courtesy of www.khov.com
p. 29

30. Complete And Celebrate A Hotspot
 If hotspot is successful, close-out the
hotspot and recognize the contributors
 Remove / demote successful hotspot
items on inspection forms
 Repeat process with new hotspot
p. 30

31. Quality Research & Next Steps
 Develop & implement
HPH Quality
Management Systems
and tools for
 Existing Homes
 New Homes
p. 31

32. Questions?
Amber Wood
Program Manager, Energy Efficiency
NAHB Research Center
301-430-6309
awood@nahbrc.com
p. 32